Renewable Energy Financing of the Year: Enel Green Power

SPONSOR: Enel Green Power
LOCATION: Coahuila and Guanajuato, Mexico
FINANCING TYPE & SIZE: $606 million project financing
BANKS: BBVA, Bancomext, EIB, IDB Invest, CaixaBank, Natixis, MUFG
LAW FIRMS: Shearman & Sterling, Ritch Mueller, Norton Rose, STB, Clifford Chance

Italy’s Enel, long a pioneer in renewable energy projects, displayed its green expertise this past year when it sponsored three solar projects in Mexico with a total capacity of 1,088 MW.

Of the three sites, Villanueva I in the state of Coahuila is the largest solar project in the Americas. The other two projects are Villanueva III and Don José in the state of Guanajuato. The projects were awarded to Enel in Mexico’s first long-term auction in March 2016. At the same time, all three solar projects received a 15-year power purchase agreement and 20-year clean energy certificates, or CELs.

Enel Green Power initially secured an 18-year, $605 million financing package for the three solar projects in October, with BBVA, Caixa, MUFG and Natixis serving as bookrunners. IDB Invest, the European Investment Bank and Bancomext also participated.

The company, which had invested $950 million in the solar farms, had previously agreed to sell 80% of the projects to Canadian institutional investor Caisse de dépôt et placement du Québec (CDPQ) and Mexican pension fund CKD Infrastructure México (CKD IM) for $1.4bn. Enel Green Power, which held the remaining 20%, continued to build and operate the assets.

Enel Green Power completed the projects last year, connecting them to the power grid.

The Villanueva projects contain more than 2.5 million solar panels and can reduce carbon emissions by more than a million tons of CO2, according to Enel. Don José , with 810,000 panels, reduces emissions of 340,000 tons.

Enel Green Power entered the Mexican renewable energy market in 2008 and now has a managed capacity of 2 GW.